Advantages of IFRS

1. Advantages of IFRS

2. Content • Easy Comparison • Developing a Unified Set of Accounting and Reporting Standards • Highly transparent and globally enforceable reporting  • Encourages cross-border transactions and investments • Facilitate international acquisitions and mergers  • Promotes Decision Making • Conclusion

3. Easy Comparison • Globalization to start with! The main advantage of IFRS is it allows the comparison of different companies, as data is presented on the same basis. • All countries have their own Generally Accepted Accounting Principles (GAAP) which is used to evaluate and make financial statements, this data is varied in all countries depending on their basic guidelines and principles hence making the comparison with the competition or otherwise unfeasible. • When all companies follow the same accounting pattern which is with IFRS, this process of comparison and analysis thus becomes possible.

4. Developing a Unified Set of Accounting and Reporting Standards • With a single set of accounting framework, the understanding of accounting procedures can be broken down from its complexity to a standard procedure. • It also facilitates better understanding and efficient reporting of financial data.

5. Highly transparent and globally enforceable reporting • IFRS works on a principle-based philosophy rather than a rule-based philosophy. • The rules philosophy could prove to be in favor of one entity or for a particular period of time and bad for the opposite entity or another stretch of time.  • Whereas working over principles, there is equality and transparency in the picture. IFRS also takes into account substance along with the legal form. It makes sure that complete and relevant information is present in the financial statement, always providing a transparent picture with the least scope of manipulation.

6. Encourages cross-border transactions and investments  • With a framework that everybody can understand in the different parts of the world, the financial statements are more recognizable for investors and potential collaborators, which brings about trade on a global level and facilitates business growth. • It builds a great amount of trust amongst all the parties involved, which is the buyers and suppliers, or the investors and investees since the single set of accounting makes the current position of each entity extremely clear and transparent. • This also helps to build the confidence of the company’s global stakeholders.

7. Facilitate international acquisitions and mergers • With the increased exposure to the global market; access to foreign companies has become easier and more approachable. • This has shown an increasing trend in making way for more foreign capital drawn in, in the forms of acquisitions and mergers with bigger brands and multinationals. • IFRS is the key to reporting statements that are globally understood and can be analyzed and assessed by the financial authorities, a transparent picture is provided and risk involved is clear which helps in facilitating such huge business decisions.

8. Promotes Decision Making • Making more deliberate, insightful decisions can be helped by using the most typical method of decision-making by identifying a problem, gathering information, and evaluating elective goals, sorting out pertinent data, and characterizing options. • IFRS standards assist you in managing your company and provide a summary of your financial situation. • Give investors and lenders more decision-making power by providing data in the form of various statements, such as a balance sheet and an income statement.

9. Conclusion • Join Contetra Pvt limited for Diploma in IFRS Online Classes • Diploma in IFRS online classes to learn IFRS standards aims to bring transparency, accountability, and efficiency to financial markets around the world. • IFRS Standards bring integrity by enhancing the international comparability and quality of financial information, enabling investors and other market participants to make informed economic decisions. • IFRS Standards contribute to economic efficiencyby helping investors to identify opportunities and risks across the world, thus improving capital allocation. • These are some of the benefactors that causes us to necessitate the use of IFRS. To facilitate your learning curve, Contetra is one such training institute that will help you in a diploma in IFRS online course. If you are interested in gaining practical knowledge to upskill your careerthen visit : https://contetra.com/diploma-in-ifrs-training/

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